1. Trading is simple, but it's not easy. if you want to stay in this business, leave hope at the door, focus on specific setups, and stick to your stops.
2. Trading should be boring, like factory work. if there's one guarantee in trading, it is that thrill seekers and impulse traders get their accounts ground into parking meter money.
3. Amateur traders turn into professional traders once they stop looking for the "next great technical indicator" and start controlling their risk on each trade.
4. You are trading other traders, not the actual stock or futures contract. who is taking the other side of your trade? is it an amateur who is chasing or a professional who has been patiently waiting for this entry all day? you have to be aware of the psychology and emotions on both sides of the trade.
5. Be very aware of your emotions, irrational behavior is every trader's downfall. if you are yelling at your computer screen, imploring your stocks to move in your direction, you have to ask yourself, "is this rational?" ease in. ease out. keep your stops. no yelling. the person who is screaming should be the one on the other side of your trade.
6. Watch yourself if you get too excited--excitement increases risk because it clouds judgement. if you are feeling peak excitement, it probably means the move is just about over. tighten your stop and look to reverse.
7. Don't overtrade--be patient and wait for three to five good trades.
8. If you come to trading with the idea of making big money, you are doomed. this mindset is responsible for most accounts being blown out.
9. Don't focus on the money. Focus on executing trades well. if you are getting in and out of trades rationally, the money will take care of itself.
10. If you focus on the money, you will start to try to impose your will upon the market in order to meet your financial needs. there is only one outcome to this scenario: you will hand over all your money to traders who are focused on protecting their risk and letting their winners run.
11. There's no need to trade 5 days per week. trade 4 days per week, and you will be sharper during the actual time you are trading.
12. Refuse to damage your capital. this means sticking to your stops and sometimes out of the market.
13. Don't overweight your trades. the more you overweight a trade, the more "hope" comes into play when it goes against you. remember, hope to trading is like acid to skin.
14. Professional traders take losses. being wrong and not taking a loss damages your own belief in yourself and your abilities. if you can't trust yourself to stick to your stops, whom can you trust?
15. Once you take a loss, you naturally forget about the trade and move on. do yourself a favor and take advantage of any opportunity to clear your head by taking a small loss.
16. If you are hesitating to get into a position when you have a clear signal, that indicates that you don't trust yourself, and deep inside you feel that you may let this trade get away from you. just get into the position and set your parameters. traders lose money in positions everyday. keep them small. the confidence you need is not in whether or not you are right; the confidence you need is in knowing you execute your setups the same way each and every time and do not deviate from the plan. the more you stick to your parameters, the more confidence you will have as a trader.
17. Traders never believe that they will blow out their account. always realize you will become a candidate for this if you don't stick to your trading rules.
18. Amateur traders always think, "how much money can i make on this trade?" professional traders always think, "how much money can i lose on this trade?" traders who control their risk take money from the traders who are thinking about the red BMW they are going to buy.
19. Professional traders focus on limiting risk and protecting capital. amateur traders focus on how much money they can make on each trade.
20. At some point traders realize that no one can tell them exactly what is going to happen next in the market, and they can never know how much they are going to make on a trade. thus the only thing left to do is to determine how much risk they are willing to take in order to find out if they are right or not.
-these words came from a very good trader-
one of my favorite sites about stock trading is
http://www.stockmarketpilipinas.com/index.php
this forum speaks about the trading strategy that could help newbies in making their trades. it also gives analysis about the stocks you want to choose.
i strongly recommend this site. many good traders there are giving their own analysis with chart explanations. just remember to stick to your stops. plan your trade very well...
